International Banking ♦ Spring 2026

Dollar Challenger? CBDCs, Complexities, and Monetary Hegemony

Heng Wang

Digitalization is transforming the architecture of the international monetary system, reshaping how currencies function and financial infrastructures evolve. Among the significant developments are central bank digital currencies (CBDCs)—new digital forms of national currencies. While CBDCs promise benefits such as efficiency, they also generate relational, technological, legal, and governance complexities that would profoundly affect the global financial landscape. Against this backdrop, a compelling question arises: will CBDCs, particularly cross-border CBDCs, challenge U.S. dollar dominance? To address this, this Article adopts a forward-looking approach to examine three interrelated crucial questions: what makes CBDCs complex? What governance complexity is likely to arise? Will CBDCs challenge dollar dominance?